Protecting your pocket and sanity when buying a home

Private Property South Africa

How to make sure you are protected when buying a property.

Jenny Adams was a recently divorced entrepreneur and had been through a harrowing hijacking ordeal at her home just two months prior. The experience left her feeling incredibly vulnerable and was one of the key reasons why she wanted to move to a more secure area. Jenny found her dream property in a gated suburb - everything about the house was a perfect fit.

“It had a small flatlet that I could use as a home office for my consulting business, it was spacious in a gated suburb with armed patrols, had a garden for my two dogs and the price was within my budget. Besides some cosmetic work and a few minor repairs that needed doing, it was perfect in every way and it all fell into place. My existing property sold within two weeks of it going onto the market, I had found my next dream home and I loved the community that I was buying into,” says Jenny. The couple selling was deep into their 70s and anxious to sell. The wife’s health was poorly as she had suffered a stroke and required specialised care. They needed the money from the sale of the property to fund their move into a retirement village with a frail care facility. Jenny’s offer was accepted, her finance approved and the deal went through without a hitch. It was only after a year of persistently blocked drains that Jenny discovered a serious undisclosed problem with the property.

“By this stage, the council workers who came out each month to unblock the drains got to know me on a first-name basis. The foreman asked if I had building plans for the house as he wanted to check the plumbing layout. I recalled a file that the previous owners had left that contained documents such as the warranty for the oven and gate motor. I had not paid much attention to its contents and this was the first time I took a good look. At the back was a building plan for the flatlet extension undertaken ten years prior - one of the key motivators for me buying the house. The plans were not approved by council and the extension was built over a manhole. The weight of the building had caused the pitch fibre pipes to collapse, causing the ongoing blocked drains. The previous owners never disclosed the unapproved extension to the estate agent or me. I certainly did not have the appetite or funds to pursue a legal route against the old couple with failing health for the non-disclosure. This was a disaster!” Council could demand that the flat be demolished if it contravened bylaws. A meeting with an architect showed some light at the end of the tunnel - a saving grace was that the cottage was not built in a servitude and the drain only served Jenny's property. But it was going to cost a lot of money to fix the drainage problems and get council approval for the plans. Jenny could have fixed the drainage problem and left it at that, but realised she would be in a compromised position if she wanted to sell the property one day, so she opted to resolve it.

The costs to address the problem have been significant. The architect had to redraw the plans for the existing cottage and detail the new plumbing layout in order to submit the plans for council approval before any repair work could commence. The reality was that if the council did not approve the plans, the cottage would have to be demolished. The plans were luckily approved. Jenny had to call in a specialised contractor with a drilling machine that could drill under the building and replace all the collapsed piping and then extend it so that a manhole could be installed at a more accessible point in the garden. The costs were almost R100k between the approval process, architects fees, specialised contractors and machinery, new pipes and manhole, and replacing all the paving and garden that had to be trenched up in the process.

“Like many people buying a home, I made an emotional purchase and suffered buyer's remorse when I had to fork out R100k from my life savings to fix the mess. I realise that it could have been much worse and I may have had to demolish the cottage and repair the damage to the drainage system if the structure contravened the bylaws. Not only would this mean my home office was gone, but the value of my property would be a lot less too.

"I can kick myself when I think that had I got a professional property inspection done, the defect would have been picked up and I would have known what I was dealing with. It may not have put me off buying the property, but at least I could have negotiated on the seller's price to cover the costs of repair. The sellers would have been hard pressed selling to anyone else with such a significant fault noted on their list of disclosed defects," adds Jenny.

Peace of mind comes standard with a Hollard home warranty It’s the countless cases of buyer’s remorse that prompted Hollard to launch a new Home Warranty product that covers all parties in a property transaction – sellers, buyers and agents. The Home Warranty couples a professional property inspection with an insurance policy which protects buyer and seller against the financial ramifications of any defects that may emerge in the property for two years after taking transfer.

“When you consider my experience and the financial ramifications, a Home Warranty would have saved me a lot of money and duress. I am self-employed so managing expenses is paramount. I had just taken a bond of R1million for my home, and was stretched to the limit with deposits, bond and transfer costs, municipal deposits, moving costs and so on. The last thing I could afford was the unplanned bills to fix the illegal building issue on my property. This did not even begin to cover my time. As a consultant who bills by the hour, I lost countless billable hours getting the matter sorted so my income was also negatively impacted. I had to dig into my life savings to cover the hard costs which was a huge blow as that fund is intended for my retirement. If the home warranty product had been available when I bought a few years ago, it would without a doubt have been a condition of my offer to purchase,” adds Jenny.

When it comes to property transactions, making sure the homework is done by professional property inspectors is the first step towards peace of mind. The next step is transferring the risk of undetected defects to an insurer. A Hollard Home Warranty should be attached to the ‘for sale’ sign of every well-maintained home for peace of mind and the best possible outcomes for all parties concerned.

To find out more or get a quote, click here.


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